From The Ecom Clinic, a weekly live session by Webgility breaking down the financial blind spots multichannel sellers don't see on their dashboards.
Rank your sales channels by revenue and Amazon is probably at the top. For most multichannel sellers it generates the highest volume, the most orders, and the biggest top-line number on the dashboard.
But revenue is not profit. Build a channel-level P&L that accounts for every fee, every fulfillment cost, every return, and every ad dollar, and the rankings often flip entirely.
In this session we walked one product across three channels (Shopify DTC, Amazon FBA, and Walmart wholesale) to show exactly how that happens, and what it means for where you put your time, budget, and attention.
We used a bamboo kitchen set. The economics are simple on purpose, so the principle is easy to follow:
Unit COGS: $26
Selling price: $75 (same across all channels)
Monthly volume: 700 units total
Broken out by channel:
Amazon FBA: 380 units, $28,500 in revenue
Shopify DTC: 240 units, $18,000 in revenue
Walmart (wholesale): 80 units, $6,000 in revenue
At a glance, Amazon is the clear winner. It sells the most units and brings in the most money. The intuitive conclusion is to keep investing there.
That conclusion is wrong.
The Shopify P&L is the cleanest of the three. The cost layers are straightforward:
COGS: $6,240 (240 units x $26)
Shopify payments fee: ~$540
Shopify subscription: ~$79
Shipping and fulfillment: $1,920
Advertising: $3,600
Returns: ~$58
After all costs, channel profit is $5,603, about 31% of revenue.
And there is a layer the P&L does not capture: you own the customer. You have their email, their purchase history, and full control over the checkout experience. That data compounds over time.
Amazon's P&L is where the math gets uncomfortable. The cost layers stack fast:
COGS: $9,880 (380 units x $26), 34% of revenue
Amazon referral fee: $4,275, another 15%, non-negotiable
FBA fulfillment: $2,200, about 8% at roughly $6 per unit
FBA storage: $456, about 1.5%
Advertising (PPC): $7,125, 25%
Returns (15% rate): $2,138, 7%
Admin fees: $170
After all costs, channel profit is $2,175, about 8% of revenue.
Pause on that. After product and platform fees alone, Amazon and Shopify land near each other, both close to $11,000. But Amazon started with $10,500 more in top-line revenue. The platform fees consumed the entire gap before you even reach advertising and returns.
Notice what every number above assumes: that you can see the referral fee, the FBA fulfillment cost, the storage charge, the return reversal, and the ad spend, broken out, per channel, per month. You can't. Your books don't hand you those layers.
Amazon doesn't deposit 380 orders. It deposits one settlement, net of every fee, as a single line in your bank feed. By the time that number reaches QuickBooks, the referral fees, FBA charges, storage, and refunds have already been collapsed into it. The $4,275 and the $2,138 that flip Amazon's ranking are inside that deposit, and your P&L can't see them.
That is the real reason operators rank channels by revenue. Revenue is the one number their books produce cleanly. Everything that turns revenue into profit is buried in settlement reports they would have to rebuild by hand, every channel, every month.
Moving the deposit into QuickBooks is sync. Decomposing it back into the fees, refunds, and COGS that decide the ranking is reconciliation. Most operators have the first and not the second, which is why the channel-level P&L stays a thing you know you should build and never do.
See what reconciled channel margin looks like when the fee layers are already posted: /ecommerce-margin-visibility
Amazon generated 58% more revenue than Shopify. It produced about 61% less profit.
Shopify kept roughly 31 cents of every revenue dollar. Amazon kept about 8 cents. Per dollar of revenue, Shopify was nearly four times as profitable.
This does not mean Amazon is a bad channel. Amazon gives you built-in traffic, organic discovery, and a marketplace ecosystem Shopify does not. For many sellers, Amazon is where customers find them for the first time. The channel has strategic value beyond the P&L.
But if you make resource-allocation decisions on revenue rankings alone, you are almost certainly over-investing in your least profitable channel and under-investing in your most profitable one.
Revenue-ranked dashboards tell you where the volume is. They do not tell you where the money is.
There is one more layer most sellers never calculate: contribution margin per operational hour. If your team spends 30 hours a month managing Amazon (listings, PPC, returns, case logs) and 10 hours managing Shopify, the per-hour profitability gap widens further still.
1. What is the actual contribution margin per channel? Build a P&L for each channel individually. Include every fee (advertising, returns, storage, and shipping), not just COGS and platform costs.
2. Are you paying more to acquire customers on less profitable channels? Compare ad spend as a percentage of revenue across channels. If you spend 25% on Amazon PPC and 20% on Shopify ads, but Shopify returns far more profit per dollar, the math speaks for itself.
3. Where is the lifetime value? Channels where you own the customer (Shopify, your own site) give you email data, retargeting capability, and control over the full lifecycle. A lower-margin channel with more control can deliver better lifetime value than a higher-margin channel where the platform owns the relationship.
Your books should rank your channels by what actually lands in your pocket, not by what comes through the door. Revenue is the starting line. Contribution margin is the finish line. And the distance between them is different for every channel.
Build a channel-level P&L every month and compare them side by side. But before you can, your books have to give you the fee layers in the first place. That is the difference between sync and reconciliation, and it is the difference between a P&L you can build and a number you can actually trust.
See how reconciled margin works: webgility.com/ecommerce-margin-visibility
Or run the questions your books should already answer: webgility.com/ecommerce-growth-questions
The Ecom Clinic runs every Thursday at noon ET. 30 minutes. One financial blind spot. Register for the next session at webgility.com/the-ecommerce-clinic